House Health & Human Services Committee Passes Bill to Increase Tobacco Tax

The House Health & Human Services committee passed Senate Bill 2843 SD1 on Tuesday with amendments to increase the annual license fee for tobacco wholesalers and dealers from $2.50 per year to $500 per year. Nine other states charge $500 to $1,500 per year for such a license to sell tobacco products.

The measure also raises the tax on cigarettes and little cigars from 16 cents per cigarette or little cigar to 22.5 cents each, or $3.20 per pack to $4.50 per pack.

“It’s not about the state coffers getting more money,” said HHS Chair John M. Mizuno (Kalihi Valley, Kamehameha Heights, Lower Kalihi). “It’s about saving over 1,400 lives lost each year to tobacco.” Rep. Mizuno adds, “Tobacco use is the single most preventable cause of disease, disability, and death in the United States. It continues to be a problem in Hawai‘i, causing approximately 1,400 deaths per year among adults and an estimated 21,000 children in Hawai‘i currently under the age of 18 will ultimately die prematurely from smoking. Each year, smoking costs approximately $526 million in direct health care expenditures and $387 million in lost productivity in the State.”

Currently, Hawai‘i is one of only two states that charge a wholesaler less than a retailer. The State Department of Health agreed that increasing the current license fee to $500 a year is in line with national practices.